Looking to curb health-insurance costs, a House committee Wednesday will take up a bill that could eventually lead to reduced benefits for state employees.
The bill would require a new menu of health-care packages in 2013 and calls for a possible shift to a “defined contribution” plan in 2014 or 2015. In such a plan, the state likely would contribute a set amount of money for each employee — who then would face greater responsibility to make coverage choices and pay additional costs.
It is unclear whether state workers will see increases in their insurance costs in 2012. The House bill does not address the issue, while a Senate budget proposal would lead to $20-a-month premium increases for rank-and-file employees who have family coverage.
Also, it appears the bill leaves open the possibility that lawmakers and legislative employees could continue to receive lower-cost insurance in the future than rank-and-file workers.
The House Health & Human Services Committee will roll out the bill (PCB HHSC 11-09) as lawmakers get ready to deal with a crush of major issues during the final two weeks of the annual legislative session.
Employee health insurance is a huge cost for the state: The Senate’s 2011-12 budget proposal puts the tab at $2 billion. This year, family coverage for a rank-and-file employee costs $14,920, with the state paying $12,760 and the employee paying $2,160, according to information presented to a Senate committee in February.
As they struggle with budget problems, Republican legislative leaders and Gov. Rick Scott have called for reining in the costs and making the insurance program more like private-sector plans.
But the issue is controversial with state workers, who have long argued that good benefits are a trade-off for accepting lower pay than many could earn in private industry.
Rep. Alan Williams, a Tallahassee Democrat whose district includes tens of thousands of state workers, called the proposed changes “short-sighted” and linked them to Scott. The governor and Republican legislative leaders also have called for requiring state employees to pay into the state pension system.
“I just think to do this at this time is a continual assault on state employees,” Williams said.
House Health & Human Services Chairman Rob Schenck, R-Spring Hill, could not be reached for comment.
The House bill calls for creating four different levels of benefits in 2013, dubbed the “platinum, gold, silver and bronze” levels. The platinum level would offer the richest benefits but also would cost the most.
As an illustration, the platinum level benefits would be “actuarially equivalent” to 90 percent of the benefits covered in 2012. At the low end, the bronze level would be 60 percent of the 2012 benefits.
The bill does not spell out what benefits would be covered at each level or how much the packages would cost.
But the bill sets up a new formula for how much the state would contribute to the coverage, with the amounts varying by benefit plan. Also, with the platinum level expected to be the most-expensive coverage, workers who choose lower-cost plans could receive extra pay to make up part of the differences in state contributions.
Under the bill, the Legislature would decide in 2013 whether to move forward with a defined-contribution plan. Such a move would happen in 2014 or possibly as late as 2015.
While details are far from clear, one type of defined-contribution plan involves a combination of what are known as “health-savings accounts” and high-deductible insurance policies.
In those cases, employers and workers put money into accounts that help cover out-of-pocket medical expenses. Those accounts are coupled with high-deductible coverage to pay for catastrophic expenses.
By Jim Saunders
